Investors Allege Stephen Marotto Made Misrepresentations

Stephen Marotto (CRD #: 5473140), a broker registered with Morgan Stanley, allegedly made misrepresentations, according to his BrokerCheck record, accessed on May 14, 2025. If you want to know more about his alleged conduct as a broker, read on.

Investor Disputes

On February 26, 2025, multiple investors alleged that Stephen Marotto engaged in misrepresentation and recommended an unsuitable investment from August 2021 to May 2024. They seek $200,000 in damages in this pending dispute.

In another pending dispute filed on December 12, 2024, several investors alleged that Stephen Marotto executed unauthorized trades, made misrepresentations, and violated the suitability rule from January 1, 2019, to June 9, 2023. The clients seek $550,049 in damages.

On January 2, 2018, an investor alleged that Stephen Marotto failed to follow instructions to liquidate an account in August 2015. The client sought $220,000 in damages but the dispute was denied by the firm.

However, investors can still seek out FINRA arbitration and potentially recover their losses even if a firm denies their dispute.

FINRA Rule 2020

FINRA Rule 2020 prohibits the use of manipulative, deceptive, or otherwise fraudulent tactics to influence the purchase and sale of securities. The misrepresentation or omission of material facts violates this rule.

FINRA Rule 2111

FINRA Rule 2111 requires brokers to evaluate whether an investment fits their investor’s financial goals. Brokers must take into account the information described in an investor’s profile, such as their risk tolerance, tax status, investing experience, and overall financial situation.

Investors who rely on brokers for recommendations may be able to recover their losses by pursuing FINRA arbitration.

FINRA Rule 3260

Unauthorized trading violates FINRA Rule 3260, which limits brokers to exercising their trading discretion in pre-approved discretionary accounts.

FINRA Rule 2010

FINRA Rule 2010 holds brokers to high standards of commercial honor and just and equitable principles of trade.

Background Information

Stephen Marotto has passed the following exams:

• Securities Industry Essentials Examination – SIE
• General Securities Representative Examination – Series 7
• Uniform Securities Agent State Law Examination – Series 63

Stephen Marotto is a registered broker in all 50 states as well as the District of Columbia, Puerto Rico, and the Virgin Islands. He is also a registered investment adviser in California and Texas.

He has also worked for First Republic Investment Management (CRD#:108559) and First Republic Securities Company (CRD#:105108).

Kurta Law Can Help

If you worked with Stephen Marotto and you have concerns about your investments, please contact us today at 877-600-0098 or info@kurtalawfirm.com for a free consultation.

For over 20 years, Kurta Law has advocated on behalf of investors who want to recover their investment losses from brokers and brokerage firms. Kurta Law is a nationally recognized law firm that exclusively represents investors against brokers and brokerage firms on a contingency basis. This means that the firm only earns a fee if our securities attorneys recover money on your behalf.